Dáil debates

Tuesday, 14 May 2019

Ceisteanna ó Cheannairí - Leaders' Questions


2:35 pm

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour) | Oireachtas source

After the withering criticism of the Government's broadband plan, Ministers, including the Minister for Public Expenditure and Reform, have called on other parties to explain their proposals for rural broadband. The Labour Party is fully committed to a comprehensive delivery of broadband to every home and business in the country as, I believe, is every other party. That goes without needing to be said. I assure the Taoiseach that our plans would deliver much better value to the taxpayers of this country.

The Government proposes to give €3 billion of public money to a private monopoly without securing ownership of the network. In almost all public private partnerships, and I was directly involved in many, the State owns the asset at the end of the contract.

It would be simply unthinkable for the public to pay €1.7 billion for the national children's hospital and not own it at the end. It would be bizarre for the Government to give ownership of the new hospital to a for-profit venture capitalist. Why does the Government believe that it is any less unthinkable to give away the national broadband network? The venture capital firm will, we are now told, provide €220 million in actual cash and rely on operating revenue to make up the rest of the cost of delivering the network. A State-owned national broadband company could just as easily generate the same operating revenue but it would pay a dividend to the people and, ultimately, reduce the net cost to the taxpayer of providing the network and it would have the income in perpetuity. Granahan McCourt intends to borrow against future income but to put up little of its own money in cash investment. In maintaining ownership of the broadband network, the State would be better placed to guarantee the affordability of rural broadband into the future.

Regardless of whether Internet access is necessary now, it will be absolutely essential in 25 years' time. However, there is no guarantee that the Government will be able to control the prices charged by the private monopoly in 25 years' time. We do not even know who will own the network at that stage because the Government's proposals, which we read last week, would allow the shares of the company to be sold again after only nine years. Vulture funds would buy the network, just like they bought Eircom, and milk it for its assets and cash again and again. The Labour Party solution is for a State-owned company to own the broadband network. It would provide access to the network on a wholesale basis, thereby creating a market for a multiple of retailers to sell Internet access to whomever they want and allowing other services to access the network to provide services directly to homes and businesses. This company would be profitable and it should repay some of the costs of providing the network in the first instance. A State-led approach is clearly objectively better. What is the justification for or the logic of the Taoiseach's argument for a private monopoly to own the rural broadband network in perpetuity?


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